Macau Poker Tournaments Promise Business as Usual Following China Poker-App Ban

Macau, China, skyline at the high rise casino resorts

Promoters of real-money poker events in the “gambling allowed” Chinese territory of Macau feel those tourneys will continue to operate as before, even as more information about mainland China’s ban of Texas Hold’em smartphone apps filters into the poker community.

The June 1 ban announced by the People’s Republic of China on Texas Hold’em poker apps and mentions of the game on social chat networks isn’t likely to have an adverse effect on existing live-tournament action in Macau, the coastal enclave – now a Chinese territory – where gambling has been allowed to flourish. That’s at least according to PokerStars, the global online-poker market leader that’s invested heavily in live tournament and cash-game play in Macau.

Speaking to the Macau News Agency (MNA), an unnamed spokesperson for The Stars Group (TSG), parent company of PokerStars, stated that the looming ban “does not materially affect our existing businesses or our live events”.

The company’s statement added: “The Stars Group continually monitors regulatory changes around the world and supports the regulation of online gaming, which has proved in many other countries, such as the UK, France and Spain, to provide a safe and secure environment for players as well as a robust taxation regime”.

Established foothold for poker

The Stars Group operates the ongoing PokerStarsLIVE Macau offerings at Macau’s City of Dreams Casino. Several different series have been conducted there, all owned and operated by Stars in conjunction with the casino and locally licensed gambling partners. Those series include the Asia Championship of Poker (ACOP), Macau Poker Cup, Macau Millions, and the Asia-Pacific Poker Tour (APPT) Macau. TSG also sponsors the PokerStarsLIVE cash-game room at City of Dreams.

Other poker entities have operated in Macau over the past several years. The Philippines-based Asian Poker Tour (APT) has offered events in Macau at least once a year since 2008, excepting 2014-15, while Wynn Macau offers an 11-table cash game room.

Some of China’s nascent poker brands offer big events in Macau as well, most notably the Boyaa Poker Tour. The Boyaa events have been held annually since 2015, though their future is in doubt following the mainland China crackdown, which targeted Boyaa’s parent company, Boyaa Interactive, the developer of several Chinese-language Texas Hold’em poker apps. Those “free-to-play” apps generated roughly 70% of Boyaa’s revenue and are likely to be forced from the huge Chinese market in the coming weeks.

“Club” gambling behind ban

Meanwhile, more information has come out about the ban on social-platform Texas Hold’em apps, which are designed as free offerings but have been used for large-scale, real-money poker play. Over a year ago, HighStakesDB reported on the illicit real-money action being conducted using the poker apps as the gaming mechanism, in conjunction with private clubs being run by agents.

Though the original HSDB piece was part report, part recruitment offer, it defined the general shape of the underground China poker market. The apps from developers such as Boyaa, Our Game, and Tencent included functions that allowed players to invite friends and set up private games and tourneys.

This led to the formation of several hundred, perhaps even a couple of thousand, clubs, each with hundreds of member players. The players purchased a no-value “coin package” within the poker app for a nominal sum, at the same time putting up a healthy chunk of real money that corresponded to the virtual coins purchased, as structured by each private poker club. The unnamed agents would then distribute winnings from the already collected deposits.

HSDB recently reported: “Many ‘social’ poker apps including the likes of ‘PPPoker,’ ‘KKPoker,’ ‘PokerLords,’ and ‘PokerFishes’ have been promoting their play money apps as a means for players to create their own ‘private clubs’ within the app, allegedly so that friends can enjoy a social game of cards on their mobile devices.”

HSDB also described this virtual scene as “where the REAL online high stakes action has been taking place over the past 18 months or so”. In its earlier report, HSDB relayed that one player had profited by roughly US $200,000 (£147,380) in a single day via the private clubs and social apps and that many known “Western” players were also participants in the games. Neither story named any of the participants in the clandestine action, nor have the identities of the game’s participants emerged elsewhere.

Nevertheless, China’s authorities caught wind of the action, which is not at all surprising given that tens of thousands of Chinese poker players were joining in. This led to the coming ban on the Texas Hold’em apps themselves in an attempt to disconnect the mechanism allowing the underground gambling activities.

Longterm slowdown for poker

It’s clear that the apps have been used for underground gambling purposes, which led to China’s crackdown. Though the live-event tourney operators in Macau profess no direct impact, the pending ban could bring negative longer-term effects. As an example, dulling of new players’ interest in poker would translate into a lower growth rate at existing Macau events.

Christopher Chee, a representative of Macau Billionaire Poker (MBP) Event Company Limited, described the crackdown as “China’s Black Friday for poker” while responding to MNA’s inquiry.

Chee said to MNA: “The recent ban on all play money apps of Texas Hold’em really concerns the government being unable to control the real money operations many of these play money apps facilitate. These apps operate under the guise of play money when in fact real money is used for settlement. This is the incorrect usage and not the intent for these apps. It is my belief greed and a few bad apples have set the entire poker industry back to its starting point in China”.